China Ramping Up US Soybean Purchases

Bloomberg’s Erin Ailworth reported that “US soybean buys by China have picked up following a summit between Trump and President Xi Jinping in May. The Asian nation has booked a number of cargoes (last) week alone, including 238,000 tons reported by the US Department of Agriculture on Friday.”

“That puts this year’s purchases roughly a quarter of the way toward meeting what the White House has said is a commitment to purchase at least 25 million tons of soybeans annually through 2028. The administration has also said China has agreed to buy at least $17 billion of additional US agricultural products annually,” Ailworth reported. “Traders continue to watch for any additional policy signals from Washington and Beijing before an expected meeting between Trump and Xi in September.”

Reuters’ Naveen Thukral, Ella Cao and Karl Plume reported that the recent purchases were made as “buyers were taking advantage of lower prices in a flurry of purchases ahead of ​President Xi Jinping’s expected U.S. visit next month.”

“‘These deals were mainly done by Sinograin and the main reason is a drop in prices last week. There are plans for President Xi to visit the U.S. in September so China is ​also trying to buy U.S. beans under its commitment made to Washington,’ an Asia-based trader at ​an international trading company told Reuters on Monday,” Thukral, Cao and Plume reported. “The companies paid a premium of $3.03 per bushel over the November Chicago Board ‌of ⁠Trade contract for shipment from the U.S. Gulf and a $3 premium for Pacific Northwest shipments, said one source. The most active soybean contract fell 5.2% last week.”

Chinese Diplomat Encourages US and China to ‘Work Together’ to Better Trade

Ailworth also reported that “US President Donald Trump’s trade war with China created a ‘tortuous experience’ that disrupted the flow of soybeans between the world’s two largest economies, a Chinese diplomat said Friday.”

“‘American farmers became a victim and bore much of the cost,’ Wang Baodong, Chinese consul general in Chicago, said Friday at the Soy Connext conference,” according to Ailworth’s reporting. “‘This tortuous experience once again shows that unilateralism and protectionism serve no one’s interest, and there are no winners in tariff and trade wars.'”

“Wang encouraged industry representatives from China and the US to collaborate to strengthen trade between the two countries,” Ailworth reported. “‘China-US agricultural trade cannot return to the past but it can have a better future,’ he said. ‘So let’s work together.'”

New Chinese Trade Countermeasures Being Closely Watched by US Ag

AgroLatam’s Marcus Ellington reported that “China has announced a broad package of legal and trade countermeasures against the United States, signaling a tougher response to recent American restrictions while keeping diplomatic channels open ahead of the expected meeting between President Donald Trump and President Xi Jinping next month.”

“Among the measures announced by Beijing are the first national security investigation conducted under China’s revised Foreign Trade Law, tighter export reviews for drone-related technologies, sanctions targeting several U.S. entities and the suspension of certain cooperation involving product certification,” Ellington reported. “According to analysts, the package highlights China’s growing ability to respond quickly through legal and regulatory mechanisms rather than relying solely on tariffs.”

“For the U.S. agricultural sector, the latest developments reinforce the importance of the U.S.-China trade relationship. China remains one of the world’s largest importers of soybeans, corn, sorghum, cotton and meat products, making the bilateral relationship a key factor for exporters and commodity markets,” Ellington reported. “Although the measures announced by Beijing are not directed at agricultural products, any change in trade conditions between the two countries can influence export demand, commodity prices and business planning across the sector.“